Tesla Reports First Annual Sales Drop

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Above: New Tesla electric vehicles fill the car lot at the Tesla retail location on Route 347 in Smithtown, New York on July 5, 2023.  Image copyright: John Paraskevas/Contributor/Newsday LLC via Getty Images

The Facts

  • Electric vehicle (EV) maker Tesla delivered 495,570 vehicles in Q4 2024, falling short of analyst expectations of approximately 504,770 vehicles, despite offering various incentives including zero-interest financing.

  • The company's total deliveries for 2024 reached 1.79M vehicles, marking its first-ever annual decline of 1.1% compared to 1.81M deliveries in 2023. Tesla's sales total in 2023 was up 37% compared to 2022.

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The Spin

Narrative A

The sales decline represents a temporary setback in Tesla's growth trajectory, with the company positioned to achieve 20%-30% delivery growth in 2025 through the launch of new lower-priced models and autonomous driving initiatives, while maintaining its position as the global EV leader.

Narrative B

Tesla faces mounting challenges from increasing competition, particularly from BYD in China and legacy automakers globally, while struggling with aging product lines and reduced demand despite aggressive price cuts and incentives, indicating deeper structural challenges in maintaining market dominance.